Over 70 ready-mix concrete plants may close in 2017 due to recession

Over 70 ready-mix concrete plants may close in 2017 due to recession
Foreign labourers work at a construction site in the Saudi capital Riyadh, in this file photo. (AFP)
Updated 08 September 2016

Over 70 ready-mix concrete plants may close in 2017 due to recession

Over 70 ready-mix concrete plants may close in 2017 due to recession

RIYADH: More than 70 ready-mix concrete plants are expected to close next year due to the recession currently experienced by the construction sector in the Kingdom.
The Jeddah Chamber of Commerce and Industry (JCCI) said that the sector has to reduce prices by 50 percent so that players could continue their operations.
The JCCI added that the government tried to increase sales and set the price at SR240 per ton and SR14 per bag, but this has not prevented the recession.
Abdullah Radwan, JCCI’s building and construction committee chairman, said that some factories had halted production because the concrete material is very sensitive.
“Aside from sensitivity, the validity period for concrete mix does not exceed four hours after mixing cement with water,” he added.
He also said that due to the recession that’s currently taking place, more ready-mix concrete plants will likely cease operations in 2017.
He said that the ready-mixed concrete sector is important in the construction industry so that both the government and the private sector must work together to support it.
On the other hand, an official of JCCI’s committee on construction, added that the volume of investments in the ready-mix sector exceeds billions of riyals.
He noted, however, that the sector had been on a downtrend due to lack of projects in the Kingdom that require ready-mix products.
He said that “it will be recalled that the Saudi market saw a similar situation in the 1980s when only companies with projects in neighboring markets were able to ride out the recession.”
For his part, Abdulaziz Al-Ghamdi, a contractor, said that the instability of the current situation is serious “in light of existing projects that have not yet been finished.”